Oman Cement Company full year results
Oman Cement Company recorded net income of OMR25m (US$64.9m) in 2010 as compared to OMR24.2m in the previous year. The company achieved an increase in net income despite a drop in production and sales volumes. Reimbursement of OMR7.3m from Government of Oman was the major reason for increase in the net income of the company. Furthermore, the net income growth was lower because of payment of OMR2.2m by the company as social contribution towards resettlement of residents effected by the environmental status of the company.
The company reported a 17.9% and 20.2% drop in production and sales volumes, respectively in 2010. Cement production reached 1.7Mt last year compared to 2Mt in 2009. On the other hand sales volume dropped to 1.7Mt during the year against 2.1Mt in 2009. The drop in the sales was attributed to the inflow of cheap cement from neighbouring countries. Exports volumes rose by 78.1% to 41.2k while the local sales dropped by 21.3%.
The company’s second expansion project to install a new 4000tpd clinker line production line is in progress and the project is expected to come online by the end of 1Q11. Once operational, s clinker capacity would double to 2.4Mta compared to 1.2Mta currently. Hence for 2011, analysts at Global Investment House have assumed an operational clinker capacity of 2.1Mta at a utilisation rate of 80%. The new clinker capacity would make the company self-sufficient and would result in a discontinuation of clinker imports which have ranged between 0.5-0.8Mt over the past 3-4 years. Published under Cement News
